Chasing Mexico's Dream Into Squalor

Published: February 11, 2001

(Page 4 of 4)

Experts estimate that it will take nearly $20 billion to meet the infrastructure needs of the border population. Under intense pressure from environmental groups, the United States and Mexican governments agreed to provide a small chunk of those funds through a development bank that was established in a side accord to Nafta. The North American Development Bank was set up to lend to local border agencies for water-related projects, including treatment plants and sewer systems.

Without doubt, the bank projects have made a difference. Earlier this year, Juárez opened its first waste water treatment plant to help decontaminate 75 million gallons of sewage dumped daily into the Rio Grande. In Reynosa, the bank is helping finance a sewage system, because most of the old one had worn away, leaving muddy veins instead of pipes. And it helped pay for workshops for Mexican utility managers, whose overburdened agencies often use outdated systems and have no reliable ways to deliver services nor to collect fees from consumers.

In all, the agency, which is jointly financed by the Mexican and United States governments, has provided about $277 million for 32 projects along the border over the last four years. But it had promised much more. The goal was to make almost $3 billion in loans to pay for water projects on the border. But so far, it has operated more like a philanthropic organization than a bank. Less than 5 percent of the bank's loan money has been used.

Suzanne Gallagher, the director of project administration at the bank, said that many municipal agencies along the border are not able to obtain the kinds of loans they need to fix their enormous infrastructure problems. So most of the bank's participation in projects has come in the form of grants from the United States Environmental Protection Agency.

Leaders of environmental groups who had warily supported Nafta because they believed in the promises of the bank have been disappointed.

''The challenges are still there,'' said Jake Caldwell, a policy specialist at the National Wildlife Federation. ''The results have been mixed.''

Reflecting his commitment to addressing the crisis, Mr. Fox appointed Ernesto Ruffo, a former border state governor as czar of the border. In an interview, Mr. Ruffo said that the Fox administration was exploring ways to attract foreign investment and secure loans for infrastructure projects.

Before he was inaugurated in December, Mr. Fox met with directors at at the North American Development Bank and backed the idea of expanding the agency's role in a wider range of projects. Mr. Fox has also said that he would support changes to make it easier for municipalities to qualify for loans.

Mr. Ruffo said that the new president would look for ways to increase taxes on maquiladoras to help pay for employee housing programs.

''Our people will have houses that are small but honorable,'' Mr. Ruffo said. ''And we are going to ask companies to collaborate on the costs of these houses because they have seen that Mexican workers are responsible, and loyal and want to learn more. But they cannot learn and grow unless they have stable living conditions.''

That kind of talk, said Mr. Christman, the economic consultant, has made maquiladora managers very nervous.

''I think you will see a slowdown in the growth of the maquiladora industry until we see how big the increases will be,'' he said.

Mr. Ruffo seemed aware of those concerns. ''We do not want to raise tariffs to the point that companies decide to leave Mexico,'' he said, ''but we also have to find ways to finance the construction of sufficient infrastructure.''

However, he and other border experts agreed that money was not the most important part of the solution. Any improvements would not last beyond the next decade, border officials have said, if growth continues at the current pace.

''We can keep pouring more money into the border,'' said Gina Weber, the United States-Mexico coordinator for the E.P.A. ''But if people come at the rate that demographers are forecasting, we will never be able to fix all the problems.''

The Dividing Line

This is the first of two articles about life on the Mexican side of the border. A second article will examine the strains between workers and management at one plant. Additional coverage is available at The New York Times on the Web:

www.nytimes.com

Photos: In Anapra, near the border, workers lack basics like running water. (Christ Chávez for The New York Times)(pg. 1); THE JOB SEEKERS -- Good wages in maquiladora plants draw many into border cities. In Ciudad Juárez, workers assemble car parts. (Joe Raedle/Liaison); THE WATER HERO -- Salvador Durón's deliveries make him indispensable in places where Juárez supplies no running water. (Joe Raedle/Liaison); UNCERTAIN LIGHT -- In Juárez classrooms without electricity, reading can be hard. (Christ Chávez for The New York Times)(pg. 6) Chart: ''On the Border'' Lured by jobs in American-owned plants, more than one million people in the last five years have migrated from Mexico's impoverished south to cities along the northern border. A surge in plants, and growing environmental problems Nationwide figures. About 60 percent of plants are on the border. Chart shows the location of plants United States and Mexico border. (Source: Twin Plant News)(pg. 6)